In our ongoing stream of research on crowdsourced translation, we’ve noticed a steady wave of investment pouring in from people who believe there is money to be made by harnessing the power of multilingual crowds. Here are a few of the organizations that have recently attracted attention in the crowdsourcing arena, particularly from investors:

Amara. This organization, formerly known as Universal Subtitles, focuses on crowdsourced translation of video subtitles. Amara received US$1 million in grant money from Mozilla and the Knight Foundation in May of 2012. It is part of an open source project that was created within the non-profit Participatory Culture Foundation. Through the platform, which now supports YouTube, videos have been translated into up to 20 languages in just 24 hours. Between 2010 and mid-2012, 170,000 videos had been translated through Amara, which competes with subtitle translation portal DotSUB.

Gengo. Tokyo-based Gengo, founded by Robert Laing, received US$5.25 million in September of 2011 for its crowdsourced translation platform in a round of funding led by Atomico. The firm had previously raised US$1.75 million in seed funding from various backers, and went into its Series A round after reporting impressive growth, particularly in Japan. It claims to have 6,000 “pre-tested” translators in its network and offers translation starting at US$0.05 per word.

Qordoba. This platform, based in the United Arab Emirates and founded by May Habib, received an undisclosed amount of early investment money from Wamda Capital in late 2011. In its first four months, it went from translating 5,000 words per day to 40,000. We’re encouraged to see investment in a technology start-up in the Arab world, given Arabic’s enormous future potential.

Smartling. New York City-based Smartling focuses purely on technology. Founder Jack Welde points out that the company is committed to developing software, not providing language services. Its software enables customers to use communities in order to quickly translate content. The company received US$10 million in 2011, following an initial first round of financing of $US4 million in 2010. Investors include Venrock, First Round Capital, U.S. Venture Partners, and IDG Ventures. Smartling’s software is also sometimes grouped with Cloudwords, another venture-backed firm that bills itself not as a tool for crowdsourcing, but as a translation management solution.

TextMaster. In November 2012, Brussels-based TextMaster received €1.64 million from French venture capital firm Alven Capital and angel investors. The company offers a database of more than 38,000 professional writers and translators, and has thus far processed more than 17 million words. They offer access to 8,000 translators with pricing starting for some language combinations at US$0.014 per word.

VerbalizeIt. Also in November 2012, this New York City-based company received US$1.5 million in equity funding from undisclosed backers. Founded by Ryan Frankel and Kunal Sarda, who met at business school, the company provides access to more than 3,000 translators and claims to have completed more than 16,000 translated or interpreted interactions.

Lastly, and in a category somewhat of its own, is a company called Duolingo, founded by Luis von Ahn (of Captcha fame) and Severin Hacker in 2011. The company received a whopping US$15 million in Series B funding led by New Enterprise Associates along with prior investor Union Square Ventures, and Ashton Kutcher’s A Grade investments. Duolingo’s idea is to translate the internet by using people who are learning a language. Before you mock this idea, consider the fact that even monolingual crowdsourced translation has been proven to be successful. What is harder to grasp is how translations produced by novices can be monetized for any one of the 36 major sub-sectors of the market.

If we tally up all the money these seven organizations have received in the past few years, we reach about US$30 million. Why does this matter? That’s far more than we’ve seen investors doling out recently to start-ups in machine translation, translation management systems, or any other technology segment in the market. It means that crowdsourced translation is currently the most active area of investment in the industry.

Investors often come to Common Sense Advisory when conducting their due diligence on the language services market. We find that they are usually fascinated by the prospect of bringing better technology and automation to a market worth more than $33 billion that currently consists primarily of human-delivered services. However, many funders fail to seek out information in order to understand the nuances of this market. A vendor’s success depends on many factors – and unfortunately for investors, merely having a great technology is no guarantee.

Here’s the catch. Even though most of the companies above have been heralded as “crowdsourced translation providers,” most of them don’t accurately fit that definition. The majority simply offer a network of freelancers and a quick way to access them. But what some of them are doing very smartly – that many traditional language service providers do not – is that they’re actually marketing themselves based on the attributes of their vendor pool. Unlike most LSPs, they don’t make the identity of their translators a big secret, but are instead building a community in which the translators have faces and names. We’ve been urging LSPs to showcase translators and bring them out of hiding for years. It’s nice to see companies finally doing this, even if it comes, oddly, under the guise of crowdsourcing.

We’ve been covering crowdsourced translation since 2007, and we’re currently carrying out a new research study in this area. If you’ve worked with a crowd or community to translate your content, tell us about your experience, good or bad. And if you’re a crowdsourced translation vendor, we encourage you, as always, to brief our analysts on your products and services.